Giving Aid an X-Ray

As evidenced by its extremely low GDP per capita and high poverty rate, Rwanda is a poor nation. The country has hence received a substantial amount of foreign aid from a variety of sources. Though still impoverished, Rwanda has actually managed these resources quite well, somewhat recovering from a devastating civil war that only ended about 15 years ago. On the surface, Rwanda looks like a success story and a model for other underdeveloped nations to follow. If looked at closely, however, it is immediately apparent that things could be much better.

Though Rwanda has a decent infrastructure of receiving and disbursing aid, the information that the country collects varies greatly, depending on the agency receiving it. Numerous government agencies are involved in the aid process, and at least six of them receive different sets of data. Additionally, the different information is rarely shared between groups. This wild variance of facts and statistics often leads to differing plans of actions from the agencies, and the lack of transparency and commonality between the data causes confusion and frustration.

Source: Randomoriginal.com

A high level of aid transparency can play a large part in alleviating these problems. If information is uniform, available, and accessible, accountability is strengthened, better data is collected, and mutual cooperation is more frequent and fruitful. While attempts to improve transparency can raise administration costs, the benefits far outweigh the costs in most cases. Regrettably, Rwanda is not the exception in regards to aid transparency; the level of openness and accessibility tends to be strikingly low across the board.

According to the recently published Pilot Aid Transparency Index, none of the 58 governments and organizations reviewed by the study received a “good” rating, while more than half received a “poor” or “very poor” grade. Fortunately, help is on the way.

IATI works to encourage donors to disclose regular, timely, and detailed information on the volume, allocation, and results of the aid that they give. While IATI is not attempting to create its own database, it is trying to create common standards and a standardized format that will make aid information easier to understand and share between partners. The initiative also hopes that these uniform standards will help recipient countries in managing their aid finances and developing more accurate monetary predictions for the future.

A large number of other campaigns and groups are supporting IATI, and are working to expand its usefulness and scope. For example, AidData has created a searchable database of over 1 million data sets relating to aid, and also has compiled extensive set of reports and research on aid development. It has also introduced interactive maps that show precise locations of where aid is occurring; this “geocoding” is an attempt to more easily show where aid overlaps as well as to point out areas that are underrepresented. Another campaign that furthers IATI’s aims is Publish What You Fund, a global movement that tracks the progress of various donors’ aid transparency. Their goal is to keep aid donors accountable and to improve the effectiveness of information accessibility as a whole.

Though essentially still in its infancy, the potential of IATI and the benefits it can bring is already apparent. The IATI has already offered concrete recommendations to the Democratic Republic of Congo, advising the country to implement an automatic data exchange that will make cooperation more feasible and lead to better predictions for the future. Returning to the earlier-discussed Rwandan situation, the initiative started a pilot program just this month that aims to improve data collection and centralize information into one common network. By combining IATI’s common standards with the expansion of its goals by outside groups, transparency in aid is hopefully transitioning from a dream to a reality.

The Center for Global Prosperity is the leading source of information about the diverse new world of private sector international development, from innovative philanthropy models to microfinance, and from social entrepreneurship to public-private partnerships. The Center publishes the Index of Global Philanthropy and Remittances, which details the sources and magnitude of private giving to the developing world.